Marginal Thinking

In Clayton Christensen’s “How will you measure your life”, he keeps his final idea about life to a warning about marginal thinking. It was surprising because he was a business school professor and trained in Economics. One of the gifts of the subject of Economics is actually the ability to think in terms of marginal costs. And this marginal thinking allows us to achieve great optimisation.

The warning that Clayton was sounding is really about over-optimisation in a context and environment that is ever changing. And because the context and actions of others are going to change and influence your flow of cost and benefits, thinking marginally can cause you to miss the big picture and fail to take the right pre-emptive actions. You will fail to realise the cost of not investing in something new and disruptive.

His application to life is equally surprising. It was to issues of moral and integrity. And I think his idea is important because so many of us have begin to think of cost-benefit analysis exactly in the marginal way prescribed by economics textbooks that we no longer leave room for discussion of values and morals. The economic principle of marginal thinking assumes that the costs and benefits assessed are independent of the context and unlike to change any of the future costs and benefits. Either that, or the dynamic element of time do not exist in the decision-making framework here.

Clayton encourages us to understand the full costs of our seemingly one-off deviations from our values and principles. Because when we perform cost-benefit analysis and think that the once off deviance would be worthwhile, we do not realise how the deviation changes us as a person, our identity and relationship to our principles.

Articulating angst

Sharing some common phenomena at workplaces to help you put words to your angst:

  • The boss want us to solve all kinds of problems instead of the problems we’re supposed to deal with!
  • The team/colleague is nice. They just disappear when work needs to be done.
  • One of the job requirements is mind-reading.
  • There are too many managers and no one to manage!
  • None of the managers want to roll up their sleeves and do the work
  • Colleagues are too competitive; most of them specialise in humble bragging.

Sharing some ways to think about seeking new opportunities and change. They are not necessarily direct quotes but lines adapted from some people who articulated them so I attributed them here.

  • Why make a living when you can make a difference? (Seth Godin)
  • Are you working hard to avoid mistakes or to achieve something? (Angela Duckworth)
  • Whether you’re important or not does not matter as much as whether you’re working on something important.
  • If the work is going to be uncomfortable, then at least work for an outcome you can be comfortable with.
  • What are you contributing – your labour or your work?

What is in it for me?

To the next person who asks you, “What is in it for me?” say, “You get to give yourself in…’

Because who wants their life to be marked with what they’ve taken away? Shouldn’t you be desiring a life marked by what you’ve given away?

Alternatively, you can ask, “What is in your life, for this world?”

One thing at a time

Too much distractions, too many pieces of work, spreading oneself thin. The most successful people succeed because they were dedicating their energies on one thing, that they want to win at. Athletes don’t go for ‘quick wins’; self-respecting scientists don’t try to ‘quick-publish’. Instead, they find their system to practice, to be able to strengthen and gain mastery, to discover and process those discoveries.

Each day, maybe it’s great to start the day deciding what is the objective you want to take on, to deal with. And stick to it; and to keep saying no to other things. A runner don’t go and play football for one season and go back to running every now and then. Even if he loves playing football, he has to keep saying no. A scientist don’t order sodium hydroxide for one experiment and then suddenly decide to use it to clean his lab instead.

You are a professional too. So set up your practice and run your system – to deliver on your objectives. One objective at a time, and deliver each of them.

Who is going to work for you?

In case you have not yet realise, plant-based meat are often less healthy than real meat. They promised you they didn’t hurt animals to make it, and that it’s plant-based, but they did not say it is healthier. Ultimately, these products are targeting meat-eaters who probably don’t have very healthy diets to begin with. Though maybe the extra sodium and saturated fats are going to make things worst.

And that brings me to the question of how companies are positioning themselves to the future workers. You might be reducing the environmental impact of food on the planet but by causing more obesity amongst non-meat eaters, is that really making that much of a positive contribution to the world?

Likewise, the money-making oil and gas companies can continue to be ‘champions’ of climate change solutions, pour parts of their profits into researching carbon capture technology, and talking about recycling plastics while extracting more fossil fuels and producing tonnes more virgin plastics, flooding the market.

Well people still have to eat, and consume energy, so where is the balance? There will always be people working for the dough; and so you get those whom you hire for their labour rather than their work.

On sponsorships

When you are finding sponsors for an event, you want to make sure that the reputation of the sponsors are good so that your event is not tainted by bad press. At the same time, you don’t want to be hounded by NGOs or enemies of your sponsors. Of course, more importantly, you want to make sure the values of your sponsors are aligned to your event’s values. So if you’re running some kind of sustainability conference, it is important that you don’t have a bunch of sponsors who are just there to do greenwashing.

This alignment of values extends itself to education sponsorships, especially the ones where you eventually are bonded to the organisation sponsoring you. You have to perform due diligence into their governance and processes, especially in terms of HR practices and talent management. Talent management is not just about paying the market rates, giving good bonuses and performance incentives.

True talent management is allowing employees to contribute with their talents, to be providing value through their opinions and not their obedience. The best companies are never short of manpower to support their work because they make the employees’ work their work. So if you’re considering a scholarship, especially a sponsorship that comes with a bond, please do your due diligence and don’t just think it’s free money.

Labour vs work

We’ve confused the dynamic about our labour and work. For avoidance of doubt, I consider labour the input and the work an output of the labour. What happens in-between of course is a matter of all the experience, expertise, intellectual, emotional management that goes into translating the labour into work.

So would you rather be paid for your labour, or for your work? Will they be the same? Think about whether you’re really hoping to exchange your labour or your work for a salary. Because if it’s your labour, quite likely, there’s a lot more people competing with you to get paid for that labour. But if you’re hoping to get paid for the work, then you need to make sure you’re producing the work for someone, not just everyone. Because not everyone will pay you for it. And you don’t need everyone to pay you for it.

So yes you can be paid for your labour: showing up, following orders and getting outcomes which you probably don’t care about. But if you do care about the future, about outcomes, then you quite likely would not care that much about the orders from your bosses. Unless they are genuinely best practices. And yes if you’re going to prefer getting paid for your work, then you’d have to find an employer that wants that work; or you are better off working for yourself and serving the client instead, the one who can see what you see, and care about what you care about.

Environment to fail

At every juncture of the spectrum of resources, we will find excuses not to fail. When we have little, we think failure is fatal. When we have a bit more, taking risk is a bit reckless. Then when we have even more, it can seem there is no need to take as much risks. And the story goes on.

It has more to do with culture than resources or incentives. In Singapore, we see incentives applied by government to enterprises who venture abroad, start businesses, invest in new things. The idea is that by partaking in some of the risks, people can take more of it. And that assumes you’re not changing the fundamental risk aversion of people. But you might just be doing that. The culture can start telling a story that entrepreneurship is not worth it without incentives. And worst, you can have armies of entrepreneurs focused on navigating bureacracy than the perils of the market, in search of grants than of market opportunities.

We can tell a different story about risk-taking. When you have little or nothing, there’s nothing to lose. When you have a bit more, it should not be so hard to make it back when you lose it. And when you have more resources, there is more cushion to fail. As a society, if we can grow to be tolerant of failure, of seeing the beauty of learning and growing from failure, we can be in a better cultural environment.

Courses, certificates and investments

Sometimes you attend a course, meet the requirements just to get the certificate, not to learn anything genuinely. It could be that you already knew everything the course had to teach and the certificate was a physical label required to prove that; or you could be just more interested in showing others you are something rather than truly being that.

This sense that you fork out the cash, check the boxes and then gain what you were showing up for is certainly appealing. And the economy is always selling you on the dream and ability to do that. Over many cycles, the connection between the certification and the underlying thing it indicates disappears. And we are left with confused signals – more generally known as noise; and confused people.

The same thing happens to the markets. There are financial metrics, performance indicators and other forms of signals which were like certificates that companies had to prove their worth. There are lots of forms to file, financial reports, investor communications. But soon the companies become more interested in the proof of worth than their real worth. So valuations go crazy, price signals become more like noise and a lot of metrics become worthless.

As investors, we are feeding the frenzy when we want to be those course participants who throw their money, show up and expect that magic happens to ensure they are properly equipped with whatever the course claims to be able to teach or make them out to be. We want to check the boxes of the investments and then earn our returns and be done with it.

When the culture is moving us to a place we don’t want to go, let’s choose not to subscribe to it. Especially when we can envision a different future, a better one.

Alignment of values

People think that finding a job that aligns with your values is perhaps a luxury. Maybe but I think when you are no longer struggling with survival, and can afford some emergency money to tide over some time of unemployment, plus young, it is quite likely that alignment of personal values and that of the organisation is incredibly important.

Generations ago, work is just work and we are able to express our values through the things we volunteer for, the work we do in our community, at home, amongst friends. The problem today is that work is demanding more and more of us.

So we would definitely need to demand more from work – especially in terms of quality of treatment to employees as humans, as people who care about a cause and not just a corporate or a boss.